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Geo-Strategic Trend

Deutsche Bank Becomes First European Bank Authorized as Frankfurt’s RMB Clearing Bank

Deutsche Bank announced on August 10 that it has been authorized by the People’s Bank of China (PBOC) to serve as the RMB clearing bank in Frankfurt, making it a regional hub connecting European financial institutions and companies to China’s payment system. The bank will provide end-to-end clearing and settlement services for cross-border RMB transactions.

Deutsche Bank is reportedly the first European bank to receive the designation. As a globally systemically important bank and one of the world’s largest euro-clearing banks, Deutsche Bank has long supported trade and investment between China and Europe, serving German and European multinational companies as well as Chinese companies expanding overseas.

The appointment underscores Beijing’s continued efforts to promote RMB internationalization and expand the currency’s role in cross-border trade and finance. Deutsche Bank China President Yin Zhen said the bank will develop more efficient RMB clearing channels and expand offshore RMB products and services to facilitate China-Europe trade and investment. Deutsche Bank was also among the first international banks to connect directly to China’s Cross-Border Interbank Payment System (CIPS) in 2015.

Source: East Money, August 12, 2026
https://finance.eastmoney.com/a/202608123839482197.html

Briefings | | |   Economy/Resources Geo-Strategic Trend

Taiwan Seeks to Dissolve Pro-China Party Over Alleged CCP Links

Taiwan’s Ministry of the Interior on August 7 petitioned the Constitutional Court to dissolve the China Unification Promotion Party (CUPP), led by Chang An-le, known as “White Wolf.” Interior Minister Liu Shih-fang said the party is a pro-China organization that has assisted CCP infiltration at the grassroots level, cross-border repression, and the use of Chinese capital to influence Taiwan’s elections. The ministry cited investigations and court rulings alleging that CUPP officials received Chinese government funding and cooperated with Chinese intelligence personnel in contacting current and retired military officers.

Liu also accused the CUPP of having extensive links to organized crime. According to Criminal Investigation Bureau statistics cited by the minister, since 2010 the party has been involved in 98 organized-crime cases involving 141 people, including attempted murder, extortion, unlawful restraint, assault, fraud, and drug offenses. Liu argued that the party is effectively a criminal organization operating under the guise of a political party and has threatened the existence of the Republic of China and Taiwan’s free and democratic constitutional order.

However, the case faces a potentially difficult path in the Constitutional Court. Under the Constitutional Litigation Act, a decision to dissolve a political party requires the approval of at least two-thirds of the Constitutional Court justices. With eight justices currently serving, six votes would be required. However, three justices have consistently declined to participate in rulings, leaving the current balance at 5–3 and making the ministry’s chances of securing the required votes appear slim.

Sources:
1. Tai Sounds, August 7, 2026
https://www.taisounds.com/news/content/71/281909
2. Central News Agency (Taiwan), July 30, 2026
https://www.cna.com.tw/news/aipl/202607300378.aspx

Briefings | | |   Geo-Strategic Trend Government/Politics

Canadian CSIS Warns Richmond Officials of Potential Chinese Interference in Municipal Election

Canada’s Security Intelligence Service (CSIS) reportedly held a closed-door briefing in July for Richmond, British Columbia, Mayor Malcolm Brodie and city councilors, warning that the municipal election scheduled for October 17 could face Chinese Communist Party (CCP) interference, including influence operations targeting the city’s Chinese Canadian community. According to The Bureau, the briefing was led by a senior CSIS regional official and relied primarily on previously public information, including cases discussed by the Hogue Commission on foreign interference.

CSIS reportedly warned that individuals with ties to the CCP could approach Richmond candidates during the campaign in an effort to influence the electoral process and undermine its integrity. While CSIS declined to confirm or deny the specific briefing, a spokesperson said recent amendments to the CSIS Act allow the agency to share information about national security threats with organizations beyond the federal government, including local governments, academia, businesses, and community groups.

The warning follows previous reports of Chinese interference in British Columbia elections. Former Vancouver Mayor Kennedy Stewart and Port Coquitlam Mayor Brad West have said they received similar warnings from CSIS. A 2024 investigation by the Commissioner of Canada Elections also found evidence of foreign interference targeting the Chinese Canadian community during the 2021 federal election. The investigation found that former Conservative candidate Kenny Chiu became a target after supporting Uyghur human rights, Hong Kong democracy, and a foreign-agent registry, with Chinese consular officials and community organizations allegedly portraying him negatively to Chinese Canadian voters.

Source: Epoch Times, August 2, 2026
https://www.epochtimes.com/gb/26/8/2/n14822025.htm

Briefings | | |   Geo-Strategic Trend Government/Politics

Taiwan’s Han Kuang 42 Exercises Expand Focus on Gray-Zone Threats and Whole-of-Society Defense

Taiwan launched its 42nd Han Kuang live-fire military exercise on August 5, a 10-day drill involving more than 20,000 active-duty and reserve personnel. The exercise is designed to test Taiwan’s ability to respond to Chinese gray-zone harassment and a potential transition from peacetime coercion to full-scale conflict. Taiwan’s Defense Ministry is focusing on five areas: whole-of-society defense, counter-blockade and escort operations, medical response, reserve mobilization, and drone-based attack and kill chains.

Military analysts highlighted several unprecedented features. Taiwan is testing drone swarms and integrated attack-and-kill chains, coordinating the navy and coast guard to counter a potential Chinese maritime blockade, and conducting large-scale civilian medical resilience drills. The exercise also includes the mobilization of more than 5,000 reservists, reportedly the largest such mobilization in Han Kuang history.

Another major focus is communications resilience. Taiwan is conducting mobile internet throttling exercises in 14 cities and counties to simulate wartime communications disruptions and test backup systems. During the drills, mobile internet is temporarily slowed rather than shut down, while voice calls and text messaging remain available.

The expanded scope reflects Taiwan’s effort to prepare for a conflict that could begin below the threshold of war. The military is increasingly integrating the coast guard, civilian agencies, medical institutions, telecommunications providers, and reservists into defense planning. The exercises suggest that Taiwan is preparing not only to repel a direct invasion but also to withstand blockade, gray-zone coercion, cyber disruption, and prolonged conflict while maintaining essential civilian functions.

Source: Epoch Times, August 7, 2026
https://www.epochtimes.com/gb/26/8/7/n14825270.htm

Briefings | | |   @CS Defense/Military Geo-Strategic Trend

PLA Commentary Accuses Japan of Moving Toward Nuclearization, Warns Hiroshima’s Tragedy Could Happen Again

On August 10, the People’s Liberation Army (PLA) published an article through its Junzhengping (“Military Politics Commentary”) account criticizing Japanese Prime Minister Sanae Takaichi for her remarks on Japan’s Three Non-Nuclear Principles during ceremonies marking the 81st anniversaries of the atomic bombings of Hiroshima and Nagasaki. The article highlighted Takaichi’s statement that Japan is “currently adhering to” the principles, arguing that the wording leaves open whether Tokyo intends to continue observing them. It warned that “What happened yesterday in Hiroshima and Nagasaki may not be impossible tomorrow in Japan.”

Japan’s Three Non-Nuclear Principles—not possessing, not producing, and not introducing nuclear weapons—have served as a cornerstone of Japan’s nuclear policy since their adoption by the Diet in 1971. Japanese media noted that Takaichi’s wording differed from that traditionally used by previous prime ministers, who have explicitly affirmed Japan’s continued commitment to the principles.

The PLA commentary portrays Takaichi’s wording as evidence that Japan’s conservative government may be moving away from its postwar anti-nuclear policy. It concludes: “If the Japanese government insists on playing with fire over nuclear issues, the heavy hammer of history will eventually fall again. What happened yesterday in Hiroshima and Nagasaki may not be impossible tomorrow in Japan.”

Source: QQ, August 10, 2026
https://news.qq.com/rain/a/20260810A05ADE00?id=20260810A05ADE00&path=a&app=news&suid=&redirect_pc=1

Briefings | | |   @CS Defense/Military Geo-Strategic Trend

China’s Joint Drill With Indonesia East of Taiwan Signals Push Toward Second Island Chain, Experts Say

China announced that its navy will conduct a maritime passage exercise with the Indonesian Navy in waters east of Taiwan in mid-August, involving communications and at-sea replenishment drills. Chinese state media described it as the first exercise between the Chinese and a foreign navy in waters east of Taiwan. The move comes as Chinese naval and coast guard activities increasingly extend beyond the First Island Chain, with Beijing seeking to expand its operational presence into the Philippine Sea or east of Taiwan, and toward the Second Island Chain.

The location and replenishment component have drawn particular attention. Military analysts cited by The Epoch Times argue that sustained operations beyond the First Island Chain require reliable long-range logistics, while at-sea replenishment could enable Chinese naval forces to remain deployed farther from the mainland for longer periods. The exercise could therefore contribute to Beijing’s efforts to develop the logistical capabilities needed for a more persistent military presence between the First and Second Island Chains.

The exercise also has a diplomatic dimension. To counter U.S. efforts to strengthen security cooperation with Japan, the Philippines, and other regional states, China has expanded maritime cooperation with Southeast Asian countries such as Indonesia, Singapore, and Malaysia, seeking to present itself as a regional security partner.

However, Indonesia has emphasized that its warship is conducting a routine “passing exercise” rather than a combat exercise, noting that similar naval passage drills are common with other countries. This qualification suggests that Jakarta may be seeking to maintain military ties with China without signaling alignment with Beijing’s broader strategic objectives.

Source: Epoch Times, August 12, 2026
https://www.epochtimes.com/gb/26/8/12/n14828298.htm

Briefings | | |   Defense/Military Geo-Strategic Trend

China’s Continued Criticism of Japan Also Targets the United States

China has continued to pressure Japan diplomatically, militarily, and economically since Japanese Prime Minister Sanae Takaichi’s remarks last year about a potential “Taiwan contingency,” with no signs of easing, according to Nikkei Asia. Analysts say Beijing’s campaign is aimed not only at Tokyo but also indirectly at Washington, seeking to weaken the U.S.-led security order in Asia. Chinese President Xi Jinping has repeatedly criticized Japan’s alleged return to militarism during meetings with foreign leaders, while Foreign Minister Wang Yi has also devoted significant attention to Japan in diplomatic engagements.

Japanese officials and China experts identify three main objectives behind Beijing’s pressure campaign. First, Xi’s strong reaction to Takaichi’s Taiwan remarks has hardened China’s policy toward Japan. Second, Beijing seeks to use Japan as a warning to other countries against challenging China’s position on Taiwan. Third, China views the U.S.-Japan alliance as a major obstacle to its efforts to expand its influence over the regional and international order.

Japan’s position as a key U.S. security partner and major power along the First Island Chain makes it particularly important to Beijing. By portraying Japan as returning to militarism, China hopes to undermine support for Japan’s defense buildup and its alliance with the United States. Beijing may also believe that President Trump’s relatively transactional approach to alliances provides greater room to pressure Tokyo.

However, the strategy carries risks. Major countries in North America, Europe, and Asia have largely rejected Beijing’s characterization of Japan as becoming militaristic. Continued Chinese pressure could instead heighten concerns about Beijing’s behavior and strengthen support for closer security cooperation with Japan.

Source: United Daily News (Taiwan), August 11, 2026
https://udn.com/news/story/6809/9683085

Briefings | | |   Geo-Strategic Trend US-China Relations

Japan’s Dominance in Critical Semiconductor Materials Strengthens Its Strategic Leverage over China

Japan’s dominance in several critical semiconductor and advanced technology materials has become an increasingly important source of strategic leverage amid intensifying competition with China. Japanese media report that despite Beijing’s ambitions to become a global leader in artificial intelligence, electric vehicles, and advanced communications, China’s technological progress remains constrained by its dependence on foreign suppliers. This vulnerability has been reinforced by the “de-risking” strategies adopted by Japan, the United States, and Europe, which have strengthened supply chain resilience while limiting China’s access to key technologies.

Japan maintains a dominant global position in three indispensable materials used in advanced manufacturing: photoresists, ultra-high-purity hydrogen fluoride, and fluorinated polyimide. Japanese companies control roughly 70–80 percent of the global market for photoresists and ultra-high-purity hydrogen fluoride—both essential for semiconductor fabrication—and nearly 90 percent of the global fluorinated polyimide market, a critical material used in flexible displays for foldable smartphones and electric vehicles.

Experts argue that any Japanese export restrictions on these materials could severely disrupt China’s semiconductor and electronics industries, affecting chipmakers such as SMIC as well as downstream manufacturers including Huawei, Baidu, and display producer BOE. China has also stepped up efforts to acquire advanced technologies through cyber espionage targeting Japanese defense, aerospace, and technology organizations. Japan’s decades-long technological leadership and manufacturing expertise continue to present formidable barriers to China.

Source: Liberty Times, August 7, 2026
https://stock.ltn.com.tw/article/4pqarmmnmrgv

Briefings | | |   Economy/Resources Geo-Strategic Trend